Assignment I


Welton v North Cornwall District Council [1997] 1 WLR 570



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Economic Loss Lecture
Welton v North Cornwall District Council [1997] 1 WLR 570. A food health inspector inspected the claimant’s guest house and noted several changes that the guest house must make to avoid being shut down. After making these changes (at significant expense), the claimant discovered that many of them were not required. The claimant sued for negligent misstatement and won.
This can be contrasted with Harris v Evans [1998] 3 All ER 522, in which a safety inspector declared that a crane used for bungee jumping had to be officially certified for that purpose. The claimant objected and was issued a prohibition notice, preventing the claimant from operating. It emerged that the inspector was wrong, and so the prohibition notice was wrongly issued. The courts held that Parliament could not have ever intended for safety inspectors to be liable for mistakenly over-applying legislation, and so the claim failed. Notably, however, the courts held that liability might arise should an inspector give bad advice which resulted in a new danger being created. Thus, a distinction can be seen between a scenario in which a local authority acts to make a situation too safe and one in which it acts to make a situation less safe.
Therefore, liability for misstatement can be seen to apply where public bodies are involved but they act in a way which is not consummate the purposes of their empowering legislation. Consider the difference between the two cases - in the former, the claimant unnecessarily spent money because the defendant advised that it was compulsory to do so. The purpose of the statute giving the food inspector power was to ensure a basic standard of food safety was met, but the misstatement caused the claimant to go far beyond that standard. It is unlikely that parliament intended for.
In contrast, the statute giving the safety inspector power was misapplied, but it would not be sensible to have safety inspectors worry about making things too safe - this would run contrary to the statute. It should also be noted that the relevant statute included its own appeals process for prohibition noticed - this meant that there was already a remedy in place for the claimant, both lessening the need for a remedy in tort to apply, and implying that Parliament knew of the risk of overeager enforcement, and so created a process to deal with it.
Teacher, Law. (November 2018). Economic Loss Lecture. Retrieved from https://www.lawteacher.net/lectures/tort-law/negligence/economic-loss/?vref=1


1 Sumarize Ltd. Elements of a contract. Retrieved from https://www.summize.com/resources/elements-of-a-contract#:~:text=Enforcing%20a%20contract%20comes%20down,legal%20right%20to%20enforce%20it.

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